PARAGRAPH 644-PAPER WASTE.

There are certain grades of waste composed of flax, jute, and hemp which, while suitable for paper making, may also be used for spinning or for other purposes.

There is always trouble when this character of material is imported, and the evidence bearing on its "chief use" is frequently unconvincing and unsatisfactory to all concerned.

Whether the material is used for paper stock, spinning, or for other purposes, it is invariably a raw material and must be remanufactured in this country in order to be made fit for the ultimate purposes for which it is imported.

Under these conditions we contend that the material should be free and that the section of the tariff act coverering these articles should be so worded that there may be no doubt to either the Government or importer whether merchandise in question is to be allowed free entry.

Practically the same arguments apply on old gunny cloth and old gunny bagging. This material has been the subject of continuous litigation between the Government and importer for a great many years, and in spite of numerous Treasury decisions on the subject, no relief has been found.

It has been decided that old gunny bagging composed wholly of small piecescalled scrap gunny-be allowed free entry as rags, but that bales containing all large pieces, or large and small pieces mixed, shall be dutiable at 10 per cent as "waste not specially provided for.'

While it occasionally occurs that some selected large pieces are packed separately and imported into this country, a large amount of the material, being essentially a waste product, is packed without regard to the size of the pieces contained therein, just as cotton rags or other waste fabrics are packed, and the result is that practically every shipment is passed upon, according to the particular bale delivered to the public stores for examination.

The Government has gone so far as to have photographs made of various sheets of gunny, to serve as a guide in determining what is and is not dutiable. If the sheet is a certain size and has only a certain number of rents or holes in it, it is dutiable at 10 per cent. The same size pieces with a few more or larger rents or holes is free, while a smaller piece with fewer rents or holes is dutiable.

This system, while evidently inaugurated in good faith, is absolutely unsatisfactory, and the importer never knows whether he has to pay duty on a shipment or not until after arrival and examination of the goods by the customs authorities.

A single invoice part of which has been short shipped will occasionally arrive on two steamers, one shipment being assessed at 10 per cent, and the other shipment passed free, and yet the merchandise was supposed to consist of but one grade.

Under the tariff section as it now reads there is absolutely no way of determining what action the Government will take relative to any importation of old waste gunny bagging. The Government is powerless to remedy this condition unless the wording of the paragraph relating to the commodity is changed.

We contend that old waste gunny bagging, whether in large pieces or small pieces, should be free, and our contention is based

First. Upon the fact that old gunny bagging is not only a waste material, but is also a raw material for our American manufacturers, whether for paper making, spinning, or other purposes. Gunny bagging is made principally from jute, and both jute and jute butts are free under section No. 578 of the present tariff act, and there is no logical reason why a waste material composed of these fibers should be dutiable.

Second. That old gunny bagging originally comes from bales of American cotton, which have been exported and the bagging returned to this country as waste. The bagging, therefore, has either been manufactured in this country, or if made abroad, has paid duty as new bagging when it was originally imported for covering bales of American cotton.

We therefore urge that in place of the present section No. 644 above quoted, there be three sections to cover the commodities involved, and we respectfully suggest the following:

First. Paper stock, crude, of every description, including all grasses, fibers, rags (other than wool), waste, including jute waste, flax waste, hemp waste, shavings, clippings, old paper, rope ends, waste rope, and waste bagging and all other waste not specially provided for in this section, suitable for paper making, free.

Second. Jute waste, hemp waste, flax waste of whatever grade, free.

Third. Old gunny bagging, or old gunny cloth, whether in large or small pieces, free. In the past, although the Government has collected various amounts in duties on the commodities covered by the above sections 2 and 3, we doubt whether there has been any real net revenue to the Government, as we believe the cost of litigation has more than offset the duties collected.

PARAGRAPH 644-PAPER WASTE.

We believe that if any raw material is entitled to free entry, all the above-mentioned commodities should unquestionably be on a free list. If, however, the need of revenue makes it imperative that duty be charged on old gunny bagging or jute, hemp, or flax waste, then we urgently ask that the duty be made specific and not ad

valorem.

If specific, no question can arise as to the amount of duty involved; whereas, if ad valorem, fluctuations in price involve penalties, litigation, and unnecessary expense and annoyance to both the Government and the importer in determining the proper duty to be assessed.

We would further ask that, whether you decide that old gunny bagging be free or dutiable, the same ruling be made to apply on all old gunny bagging, whether same be composed of large pieces, small pieces, or a mixture of both, as it is impossible to attempt to specify gradings of this material without opening the way to continuous and expensive litigation.

We believe that the judges of the United States Board of Appraisers will corroborate our statement that section number 644 of the tariff act of 1909 is ambiguous and unsatisfactory and the cause of an unusual amount of litigation, and that it should be replaced by a section or sections that will state clearly and without ambiguity what articles are and are not dutiable.

Respectfully submitted.

THE ASSOCIATED DEALERS IN PAPER MILL SUPPLIES OF NEW YORK.
JAMES PIRNIE,

ADOLPH E. SALOMON,

FRANK C. OVERTON,

Committee.

Members of association.-Atterbury Bros. (Inc.); Ira L. Bebee & Co.; Box Board & Lining Co.; Darmstadt, Scott & Courtney; Michael Flynn; P. Garvan (Inc.); E. Cross & Co.; Daniel M. Hicks; John H. Lynon & Co.; Geo. W. Millar & Co.; Michael McGuire; J. B. Price; Perkins, Goodwin Co.; Adolph Salomon; Salomon Bros. & Co.; M. Shea Paper Stock Co.; Wilkinsons Bros. & Co.; J. Andersen & Co.; Edwin Butterworth & Co.; Chase & Norton; Castle, Gottheil & Overton; Gatti McQuade Co.; Richard Godfrey; Wm. Hughes & Co. (Inc.); George Carrizzo & Co.; Main Paper Stock Co.; Marks Maier; Maurice O'Meara & Co; M. Pascarella; Thos. Smith & Son; Felix Salomon & Co.; L. B. Shoenfeld & Co.; Troiano & Defina; Parsons Trading Co. PARAGRAPH 645.

Paraffin.

PARAGRAPH 646.

Parchment and vellum.

PARAGRAPH 647.

Pearl, mother of, and shells, not sawed, cut, polished, or otherwise manufactured, or advanced in value from the natural state.

PARAGRAPH 648.

Personal effects, not merchandise, of citizens of the United States dying in foreign countries.

PARAGRAPH 649.

Pewter and britannia metal, old, and fit only to be remanufactured.

PARAGRAPH 650-SURGICAL INSTRUMENTS, ETC. PARAGRAPH 650.

Philosophical and scientific apparatus, utensils, instruments, and preparations, including bottles and boxes containing the same, specially imported in good faith for the use and by order of any society or institution incorporated or established solely for religious, philosophical, educational, scientific, or literary purposes, or for the encouragement of the fine arts, or for the use and by order of any college, academy, school, or seminary of learning in the United States, or any State or public library, and not for sale, subject to such regulations as the Secretary of the Treasury shall prescribe.

For surgical instruments, see also Schedule C., p. 2138.

SURGICAL INSTRUMENTS, ETC.

TESTIMONY OF C. R. CORBIN, OF THE RANDALL FAICHNEY CO., BOSTON, MASS.

The witness was duly sworn by the chairman.

Mr. CORBIN. We wish to protest against the duty-free entry of surgical instruments, apparatus, etc., by hospitals, for the following

reasons:

First. There are employed in our factory more than 200 American instrument makers, the majority of whom receive from $18 to $28.50 a week.

Second. We are one of over 200 surgical instrument makers, these various makers employing at actual manufacturing from four men upward.

Third. We wish further to protest against the brief of George F. Clover, superintendent of St. Luke's Hospital, New York, because of its unfairness, who claims that high-grade surgical instruments can not be manufactured in this country. This is a misrepresentation of the facts, because it is a well-known fact that instruments of the very best quality are made in the United States and used by our most skilled surgeons.

Mr. HAMMOND. Exported from the United States?

Mr. CORBIN. No; they are manufactured in the United States.

Fourth. The Department of Commerce and Labor some months ago refused to issue certificates of accuracy on foreign-manufactured fever thermometers, because the variations were too great for actual use.

Now, I may add that we are particularly at a disadvantage in the manufacture of surgical instruments in this country, because the doctor is an ethical gentleman and does not believe in patenting his ideas. A man in St. Louis comes to us, or to a firm such as I represent, and asks us about getting out a cystoscope, an instrument scientific enough to tap a man's kidneys without cutting him open. Such instruments have been designed and have been worked out by American surgical instrument manufacturers. Our doctor is also unpractical, because we can not charge him for patron work, so we make this instrument at practically a loss. We create a market for it, and after we have created a market and it becomes universally used, and written about in the medical journals, the German importer takes our instrument which we have no patent on-the doctor will not patent-takes it over to Germany, and in about 90 days we have the instrument on the American market at about 25 per cent less than we can make it and make a profit. The firm I represented

last

PARAGRAPH 650-SURGICAL INSTRUMENTS, ETC.

year made a profit sufficient to pay 7 per cent on preferred and 3 per cent on common stock. We are an incorporation.

There is an instrument maker in Indianapolis who is a very scientific man, a man of wonderful genius, and he has devised many instruments at the suggestion of the medical profession, and I was talking to him in Chicago not long ago, and I said, "Mr. Schmidt, what do you make out of your business?" "Well," he says, "I have a whole lot of fun, because it is a work that I like, but after I had paid my rent and my men last year my average salary was $18 a week." Now, we could go on indefinitely. Dr. Kelley, of Johns Hopkins, for instance, has invented and designed many instruments that have been made in this country, and after they become enormously popular they have been taken by the German manufacturers and duplicated and sold at a less price than we could afford to make them, and some of these instruments we have had to discontinue making on that account. One other instrument that stands out is a needle holder. There was a needle holder invented in New York that possibly is the best needle holder that was ever made. The needle holder was copied by the German manufacturers, and although it was imported in this country against the duty, it is no longer a profitable article to make, and so we feel in view of these facts that it would work a hardship on us if the hospitals could import, duty free, because, as we heard yesterday, a young doctor serves as an interne in the hospital after he has graduated; the older doctor from whom he takes instructions is on the board of directors and knows about what the hospital pays for things. Now the situation is this: That when one of our representatives goes to that doctor and asks him to pay $1.50 for a speculum that the duty had been paid on, and he knows that the hospital has been buying it for 95 cents, it puts us at a disadvantage. Now, when you say the hospitals do not sell instruments, or when that claim is made, it is an unfair statement; for instance, clinical thermometers are sold to nurses for 35 cents each, and they cost wholesale about 28 cents. Now, after the nurse who has served her time goes out into general practice, she can not understand why she has to pay 75 cents for the thermometer. And I could cite other cases if you cared to take the time.

Another case that comes up is in the operating tables. Now, when the statement is made that the foreign countries are far advanced in surgical cases, I think it is distance that lends enchantment. It is a fact that the best operating tables are designed in this country and are copied abroad. For illustration, there is an operation necessary to lift a person up in such a position [illustrating]. Now, the patient is brought in and laid upon the towel, two assistants lift up the towel, and the little bench is slid under him. In America we turn a wheel and raise the patient a fraction of an inch at a time and place him in position.

Another point is the X-ray business. Now, the medical profession criticized the X ray very severely when it came out, even after it had received the indorsement of such men as Mr. Edison. I know that the first X-ray outfit put in a hospital was put there on consignment, and it took considerable salesmanship on the part of the surgical-instrument men to induce hospitals to put in the X-ray outfit. They now

PARAGRAPH 650—SURGICAL INSTRUMENTS, ETC.

find they are of great service, and it appears the Germans can manufacture these outfits cheaper than we can in this country, and if the duty was repealed it would hurt the electrical surgical side of our business tremendously.

Mr. RAINEY. In connection with the general schedule I would like to print into the volume the statistics as to certain New England mills, issued by Hawes, Tewksbury & Co., members of the Boston Stock Exchange, in a circular of November, 1912, the last circular they have issued in connection with the woolen schedule. I would like to print in the record an analysis of the report on Farr Alpaca, Holyoke, Mass., woolen mills, the first woolen mill report for 1912 to make its appearance, which appeared in the Springfield (Mass.) Daily Republican of Thursday, January 28. And in connnection with the metal schedule, I would like to print in the record a letter addressed to me by Mr. George J. Gruen, a large manufacturer, of Cincinnati, Ohio, asking for a hearing at some time after the 5th of February, which, of course, can not be granted, but inasmuch as his letter contains much valuable information on this subject, I want to ask permission to print it in the record. And also I would like to print in the record the brief on the Parker rates submitted by Mr. Parker in connection with the cotton schedule, which is being prepared by Mr. Edward B. Shipley, of 49 Leonard Street, New York, an importer and commission merchant who appeared before us. The CHAIRMAN. We will be glad to grant this privilege.

Hon. OSCAR W. UNDERWOOD,

WASHINGTON, D. C., February 1, 1913.

Chairman Committee on Ways and Means, Washington, D. C. RESPECTED SIR: We wish to protest against the duty-free entry of surgical instruments, apparatus, etc., by hospitals for the following reasons:

First. There are employed in our factory more than 200 American instrument makers, the majority of whom receive from $18 to $28.50 a week.

Second. We are one of over 200 surgical instrument makers, these various makers employing at actual manufacturing from 4 men upward.

Third. We wish further to protest against the brief of George F. Clover, superintendent of St. Luke's Hospital, New York, because of its unfairness, who claims that high-grade surgical instruments can not be manufactured in this country. This is a misrepresentation of the facts because it is a well-known fact that instruments of the very best quality are made in the United States and used by our most skilled surgeons. Fourth. The Department of Commerce and Labor some months ago refused to issue certificates of accuracy on foreign-manufactured fever thermometers because the variations were too great for actual use. Respectfully submitted.

THE RANDALL FAICHNEY Co.,
C. Ross CORBIN, Boston, Mass.

TESTIMONY OF CHARLES J. PILLING, REPRESENTING MESSRS. G. P. PILLING & SONS CO., OF PHILADELPHIA, PA.

Mr. PILLING. This is paragraph 650. It is incorrectly stated in the calendar.

As seen from the standpoint of a manufacturer of surgical instruments, a double blow and a most dangerous one is aimed at the surgical-instrument industry of this country.